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Micron Technology Inc. said said last week that a production facility was experiencing issues that are likely to affect its memory output this quarter, as the memory-chip company faces heavy demand for its products.

Nitrogen supply that is needed to build dynamic random access memory (DRAM) chips at one of its facilities had been disrupted.This disruption could pull DRAM production by 2% to 3% this quarter.

The DRAM market is still witnessing a huge demand-supply gap which is escalating prices. Micron generates more than 65% of its revenues by selling DRAM products, it is the biggest beneficiary of this supply shortage.

The heavy demand for memory chips is due to the growing adoption of artificial intelligence requiring higher capacity and more powerful memory and storage solutions is also expected to drive growth.

In 2017 smartphones had a 33.4% growth in DRAM content, to an average of 3.2 GB per device. As smartphone OEMs plan to roll out devices with higher capacity, demand for DRAM is likely to shoot up much faster, thereby benefiting Micron’s top and bottom-line results.

Datacenters Demanding More Memory for StorageThe need for effective storage facility has been growing rapidly with the immense volume of data generated through smartphones and Internet-connected devices, along with the increasing adoption of artificial intelligence and cloud computing.

Market research firm International Data Corporation forecasts that by 2025, the global datasphere will grow to 163 zettabytes (trillion gigabytes), which is 10 times the 16.1 zettabytes of data generated in 2016. And almost 20% of this will be critical to daily lives and nearly 10% will be hypercritical.

Looking at the opportunity in data storage, data-center operators, such as Amazon, Google and Facebook, have accelerated their server-deployment efforts to grab market share in the cloud-service space.